Christopher Johnson: UK supermarkets are well known for their groceries. But do they also have a reputation for paying delicious dividends too? Traditionally, supermarkets are not known for being high yielding dividend payers. Yet, Sainsbury’s is bucking the trend. The UK supermarket chain is currently yielding 5.08% and paid its last dividend on December 20th, 2024, after a near 10% fall in its share price since last year.
CJ: Since 2022 Sainsbury’s has consistently paid a half year dividend of 3.90p and an annual dividend of 9.20p. The business is still a long way off the heights it enjoyed in 2014 when its annual dividend reached 12.30p. Tesco, the UK’s biggest supermarket, has a dividend yield of 3.38%. Its half year dividend for 2024 reached 4.25p but its annual dividend reached 8.25p.
CJ: Tesco’s last dividend was paid on November 22nd, 2024. Yet, Tesco’s dividend story is one of growth. The UK supermarket stalwart has seen its dividend increase in 2024 up from levels in 2023. That year the business paid a half yield dividend of 3.85p and an annual dividend of 7.05p.
CJ: However, Marks & Spencer has a very low dividend yield of 0.88%. M&S’ most recent dividend has just been paid, and it was just 2p. Although, this is a slight improvement from the 1p paid to shareholders on January 12th, 2024. Recall that the UK supermarket chain paused dividend payments for shareholders for around four years. But in that period its shares have soared, which has pushed down the dividend yield. Its last payment before reinstating dividends was on January 10, 2020, when it paid 3.9p to shareholders.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.
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